We are sometimes asked, “why should I buy solar now? Prices have been falling, won’t they keep falling?” Well, prices cannot drop forever — and now may be the best time to buy. The cost of solar panels has fallen 80% over the past 5 years, driving some manufacturers out of business. Now, prices are stabilizing as the global glut in solar panels is easing. Those who are waiting for solar panel prices to drop further may miss the boat if they wait too long — as demand heats up (as it currently is) we may see prices rise.
Even with the recent price drop, we’ve had customers who added panels five years ago tell us, “We’re happy we acted when we did — our energy savings alone make solar a great investment.”
For more on this, see this story from Bloomberg News:
Solar-panel manufacturers are back on upswing
SUNDAY, NOVEMBER 3, 2013
BY EHREN GOOSSENS
BLOOMBERG NEWS
Solar industry manufacturers are rebounding from a two-year slump faster than technology companies recovered from the dot-com bubble of the late 1990s.
The benchmark BI Global Large Solar Energy Index of 15 manufacturers, which slumped 87 percent from a February 2011 peak through November 2012, has regained 55 percent of its value in the past year. The technology-dominated Nasdaq Composite index reached its post-bubble low in October 2002 and regained 37 percent of its March 2000 peak value in the next year, according to data compiled by Bloomberg.
Suppliers including California’s SunPower Corp., which has gained more than fivefold this year, and China’s Yingli Green Energy Holding Co. are driving the rally as panel prices stabilize. Installations at power plants and on roofs will swell 40 percent this year from a 6.1 percent pace last year.
“The worst is probably behind us,” Jenny Chase, lead solar analyst at Bloomberg New Energy Finance, said in an interview. “We’ve just gone through a big trough in solar supply.”
Investors poured $205 billion into clean-energy projects in the past year, soaking up some of the global oversupply of panels. The recovery will continue in 2014 with prices remaining stable, Chase said. Manufacturers are “a lot less depressed.”
Optimistic analysts
Analysts have become more optimistic about solar shares in recent months. The average rating for SunPower, the biggest U.S. supplier of poly-silicon-based solar panels, is 3.5, up from 2.4 in December and the highest in more than two years, according to data compiled by Bloomberg. A 5 rating indicates investors should purchase the shares, and 1 means they should sell.
Jinko Solar Holding Co., the only Chinese solar manufacturer to report a profit in the second quarter, has an average rating of 3.7, up from 2.3 in May, data compiled by Bloomberg show. Its shares have more than tripled this year.
Investors have rushed back into shares of the biggest panel makers even before they’ve returned to profit. Yingli, which has more than doubled, is forecast to report narrowed losses compared with 2012. Canadian Solar Inc., which has risen almost sevenfold, is forecast to return to a profit of $27 million from a $195 million loss in 2012.
